While the latest index remains at the second highest level in the past two years, the reading remains subdued with on-going concern around labour market conditions and earnings growth, Westpac said.

"The relatively low level of the index fits with the observation that while the New Zealand economy was gathering a substantial head of steam over 2013 it had yet to reach its full capacity," the report said.

Much of the negative feeling was seen in wage growth, with the net percentage of expected earnings to increase over the next year fell to a 29 per cent, the lowest since June 2012, from a 33 per cent in the September quarter. The report attributes low wage growth to continuing depressed inflation.

The tentative rise indicates that pressures on jobseekers are easing. This confidence combined with other indicators such as reported greater hiring or hiring intention, a 15 per cent increase in online job advertisements on a year earlier and jobseeker support benefits falling 5 per cent, gives weight to the prediction that the unemployment rate will drop below the post-recession range of 6 to 7 per cent range in 2014,Westpac said.

"The net percentage of people saying that jobs are easy rather than hard to get rose by five points to - 47 per cent. This was the least negative reading since December 2008," the report said. That "supports our view that the unemployment rate should nudge a bit lower in the December quarter, from its previous outturn of 6.2 per cent."

Employment confidence was not widespread across the nation, with continuing declines in the rural regions, while the three main centres gain. Canterbury continues to lead other regions with employment confidence advancing to 115 from 113.1. Wellington confidence jumped up 7.7 percentage points 104, indicating optimism now outweighed pessimism having previously been the most negative region.

The rise in confidence was focused in middle-income groups, those earning between $30,000 to $70,000. Confidence rose for those aged 30 to 50, while the under-30s felt pessimistic about future employment options.